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Last week they sold out our farmers - will our steel workers be next?

June 20, 2021 9:22 AM
By Toby Helm in The Guardian

Sector faces glut of cheap imports because of recommendation that EU protections should not be renewed

The government was on Saturday night accused of dealing a hammer blow to the struggling British steel industry in the name of Brexit and free trade, as a fresh political row blew up over plans to allow more cheap foreign imports into the UK.

Several Tory MPs in "red wall" seats, backed by the Labour party and steel industry leaders, are furious that a government body has officially recommended that protections inherited from the EU to safeguard UK producers be ended imminently by the government.

On Monday Labour will stage a Commons debate and vote on the issue to try to kill off the plans, hoping to win Tory backing from backbenchers who have voiced their anger at the harm more cheap imports would do to their steel-producing areas.

Referring to the recent recommendation by the Trade Remedies Authority (TRA) - an arm's-length body that operates in the Department for International Trade - Gareth Stace, director general of UK Steel, which represents the industry, said the fact that the EU had just renewed its protections on Friday meant the UK steel industry would be even more exposed if ministers acted on official advice. "The TRA's decision to terminate steel safeguards for half of the product categories exposes the UK's steel sector to uncontrolled surges in imports and is a hammer blow."

Stace added: "The UK government is squandering the opportunity to make Brexit work for domestic industry and is letting an arm's length body harm the British steel sector, not support it. We want to work with the government to level up Britain, instead they are levelling down our steel sector."

The shadow business secretary, Ed Miliband, said: "The significance of this decision for our steel industry cannot be overstated. UK Steel has described the government's proposal as 'madness', and ministers must listen. If the government slashes import protection, it risks opening the floodgates to cheap steel imports, undercutting British steel.

"We should be using every tool at our disposal to support our steel industry yet the government is pursuing the opposite course. This is the opposite of what the government promised they would do after Brexit."

The row exposes growing tensions over the government's pursuit of free trade arrangements to replace access to the EU single market after Brexit.

Last week, UK farmers claimed ministers had betrayed them after details emerged of a free trade deal struck with Australia, which they fear will result in them being undercut by cheaper, lower-quality meat imports.

Labour has argued that when making trade decisions, ministers must take into account the impact on domestic industry and strategic national interests.

Holly Mumby-Croft, the Tory MP for Scunthorpe and co-chair of the all-party parliamentary group on steel, has already raised the alarm, saying: "There is a real risk that the UK will be increasingly vulnerable to imports if steel safeguards are removed."

The EU introduced the limits in 2019 to protect Europe's steel industry from a glut of steel it feared would be diverted from the US after Donald Trump imposed tariffs on cheap imports of steel from China and elsewhere into the US. When the UK left the EU, the limits were transposed into UK law but their application will lapse at the end of this month. The EU announced last week that it would extend the limits for three more years.

The steel industry currently employs 33,700 people in the UK with another 42,000 in related supply chains. Oversupply in the world market has been a major factor in the UK industry's struggle for survival.

The Labour MP for Aberavon, Stephen Kinnock, said: "Monday's vote will reveal whether outsourcing the decision to remove nine critical steel safeguards is a Conservative cock-up, or a Conservative conspiracy. Either the government votes with Labour to bring forward the emergency legislation that can amend mistakes in the Trade Bill, or it votes against and in so doing exposes the true intention of its post-Brexit trade policy: to sacrifice British jobs and manufacturing on the altar of its desperation to do trade deals.

"Last week they sold out our farmers. Will our steelworkers be next?"

The government said: "All interested parties, including importers, domestic producers and overseas exporters, have been able to participate in the review to provide evidence to factor into the TRA's assessment. The TRA is a non-departmental public body, and all its decisions are based on a thorough analysis of the evidence.

"The trade secretary's decision will be published before the measure is due to expire on 30 June."

The shadow business secretary, Ed Miliband, said: "The significance of this decision for our steel industry cannot be overstated. UK Steel has described the government's proposal as 'madness', and ministers must listen. If the government slashes import protection, it risks opening the floodgates to cheap steel imports, undercutting British steel.

"We should be using every tool at our disposal to support our steel industry yet the government is pursuing the opposite course. This is the opposite of what the government promised they would do after Brexit."

The row exposes growing tensions over the government's pursuit of free trade arrangements to replace access to the EU single market after Brexit.

Last week, UK farmers claimed ministers had betrayed them after details emerged of a free trade deal struck with Australia, which they fear will result in them being undercut by cheaper, lower-quality meat imports.

Labour has argued that when making trade decisions, ministers must take into account the impact on domestic industry and strategic national interests.

Holly Mumby-Croft, the Tory MP for Scunthorpe and co-chair of the all-party parliamentary group on steel, has already raised the alarm, saying: "There is a real risk that the UK will be increasingly vulnerable to imports if steel safeguards are removed."